Don’t take a piece of paper to a knife-fight
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Negotiation Anatomy™
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One of the JC’s maxims. If you have a real business risk, then you need a real business control for it. Not a piece of paper that you signed in 2007 and then stuck in a drawer.
To be sure, you can support your practical operational controls — really make them sing — with a stout legal contract, but if you don’t have any practical operational controls, or if the fellow who is supposed to be monitoring them is asleep at the switch, then the fact that, back in the day, credit had your docs unit engage in six months of hand-to-hand combat with your client to shove a NAV trigger in their ISDA is not going to get you out of a jam if you find out, some years later, that said client blew through the NAV limits you carefully confected, but nine months ago.
Sticking anything in a document that no-one will ever read again, and most people in your organisation wouldn’t understand even if they did, is a really bad way of hedging against a real risk.
Don't go to knife fights
Time for on of the JC’s patronising little parables.
A fellow was out on his bicycle, thundering down Cranley Gardens, as you do, enjoying the rush of wind through his thinning thatch and generally revelling in uncommon gratitude for the affordances — usually so depressing, for a man his age — of gravity. Cranley Gardens is steep, has a dogleg and a few intersecting crossroads that come at it from oblique angles. But straight-through traffic has the right of way — of that there is little doubt.
Yet our friend —should we call her Prudence? —still took a measure of caution, constantly scanning the intersections. She stood ready to slam on the brakes should some damn fool pull out in front of her.
Behaviour only a young lad, still convinced of immortality, would query. And it seems to be stating no more than the bleeding obvious that the psychological satisfaction one might derive from knowing one was in the right, had been all along, and that the other man was utterly to blame, and liability entirely his, without question of mitigation or contributory negligence — runs a distant second to the inconvenience of the six months you'll spend in traction recovering, yes, at the tortfeasor’s soke and unlimited expense, and the painful therapy you'll need of you’re ever to walk again.